A group of 53 Columbia professors, students and alumni
released a letter yesterday denouncing Bollinger’s defense this
week of Dimon, a fellow member of the New York Fed board who
testified to Congress today about JPMorgan’s recent $2 billion
trading loss. Bollinger, 66, dismissed calls for Dimon to step
down from the Fed board after the losses were revealed.

“As an educator you have a special responsibility to
demonstrate moral and intellectual credibility, something you
have failed to do in this situation,” the group said. They
urged Bollinger to reverse his support and call for Dimon’s
immediate resignation.

The group, which includes Eric Schoenberg, an economics
professor at Columbia Business School, also said Bollinger may
have a conflict of interest because of donations JPMorgan made
to Columbia. David Stone, a spokesman for Columbia, said in an
e-mail that the Ivy League university has collected about $2
million from the bank in the past eight years, representing less
than 1 percent of its fundraising.

Stone declined to comment further.

Isolated Event

Lawmakers are questioning Dimon at hearings this week and
next about the bank’s losses after he initially called April
news reports about the trades “a complete tempest in a
teapot.” Shares of the bank, the biggest in the U.S. by assets,
dropped 17 percent through yesterday since Dimon disclosed the
mounting losses on May 10, lopping about $26.5 billion from the
firm’s market value.

Dimon, 56, said in prepared remarks to Congress today that
his traders didn’t understand the risk they were taking with
bets on credit derivatives and hurt the bank. He also said it
was an isolated event and may have been fueled by switching to a
new risk model.

Bollinger, who joined the board of the New York Fed after
Columbia hired him in 2002, told the Wall Street Journal this
week that people calling for Dimon to step down from the board
were “foolish” and possessed a “false understanding” of how
the Fed works.

Columbia, which was founded in 1754, is located on
Manhattan’s Upper West Side and belongs to the Ivy League, which
comprises eight private colleges in the U.S. northeast.

Bollinger’s Responsibility

Bollinger abdicated his responsibility to maintain the
“integrity, dignity and reputation of the Federal Reserve
System” by supporting Dimon’s tenure, according to the letter.
Not only is the trading loss being investigated, Dimon has
“long campaigned aggressively against important regulatory
reforms designed to protect excessive risk taking,” they said.

“Gamblers should not have power over the banking system,”
Marcellus Andrews, a professor of economics at Columbia, said in
a statement attached to the letter. “Dimon is a gambler of the
worst sort -- one whose arrogance is such that he mistakes a run
of good luck for skill and surrounds himself with boot lickers
-- in banking and in politics.”